Conservative Leader Pierre Poilievre and MP Lawton are pitching a plan to scrap the federal sales tax on used cars, aiming to make vehicle ownership more affordable for Canadians. The proposal, announced on June 15, 2026, would eliminate the Goods and Services Tax (GST) on used car purchases, potentially saving buyers hundreds or thousands of dollars.
Key Details of the Proposal
The plan targets the federal portion of sales tax on used vehicles, which currently adds 5% to the purchase price. By removing this tax, the Conservatives argue that Canadians would face lower upfront costs when buying a used car, easing financial pressure on households.
Potential Impact on Consumers
According to estimates, eliminating the GST on used cars could reduce the price of an average used vehicle by over $1,000. This move is intended to stimulate the used car market and provide relief to those who rely on affordable transportation.
Political Context
Poilievre and Lawton are framing the proposal as part of a broader effort to reduce taxes and increase affordability for Canadians. The announcement comes amid ongoing debates about cost-of-living issues and economic policy ahead of the next federal election.
Reactions and Next Steps
Industry groups have welcomed the idea, noting that it could boost sales and help consumers. However, critics question the fiscal impact and suggest that provincial sales taxes may still apply. The Conservatives have not yet detailed how they would compensate for the lost revenue.
